HomeMy WebLinkAbout489 McClayMr. William McClay
2413 W. Colonial Drive
Roothwyn, Pa 19061
Re: 85 -060 -C
STATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
ORDER OF THE COMMISSION
May 2, 1986
Order No. 489
Dear Mr. McClay:
The State Ethics Commission has received a complaint regarding you and a
possible violation of Act 170 of 1978. The Commission has now completed its
investigation. The individual allegations, conclusions, and findings on which
those conclusions are based are as follows:
I. Allegation: That you, a school hoard member of the Chichester School
District, violated Section 3(a) which prohibits the use of public office or
any confidential information received from holding that office to obtain
financial gain other than compensation provided by law for yourself, a member
of your immediate family or a business with which you are associated when you
participated in decisions of the school hoard which awarded contracts and
husiness to Airport Automotive, a firm by which you are employed.
A. Findings:
1. You have served as a school director in Chichester School District since
Oecemher of 1983 and, as such, are subject to the requirements of the State
Ethics Act.
2. You are also employed by Travel Park Incorporated which trades as Flying
Carport. Roth companies operate from 6800 Essington Avenue, Phildaphia, PA,
19153.
a. You are employed as the operations manager and have been employed by
the firm since November of 1980.
h. Flying Carport is a valet parking service that, provides parking and
shuttle transportation for individuals traveling from the
Philadelphia international airport.
c. You are second in charge to the President, ,lames L. Rrennan.
d. Flying Carport leases vans for the Franklin Leasing Co. in order to
provide the transportation service to and from the airport.
Mr. William McClay
Page 2
May 2, 1986
3. Pennsylvania Corporation of Records show the following:
a. Travel Park Incorporated was incorporated on November 29, 1984 with
100 shares of common stock. The lone stockholder recorded was
Attorney Richard H. Lipoiv.
b. Flying Carport, 6800 Essington Avenue, Philadelphia, PA, 19153 was
i ncorporated on October 21, 1982. The papers were submitted by the
corporation, Franklin Page Enterprises, Inc., 6800 Essington Avenue,
Philadelphia, PA, 19153. Flying Carport was identified as a parking
facility.
c. Franklin Page Enterprise, Inc., P.O. Box 213, Righters Mill Road,
Gladwynne, PA, 19035, filed for incorporation on August 3, 1981. The
lone incorporator was listed as C. Lawrence Rutstein, 215 South Broad
Street, Philadelphia, PA.
d. No records were available for Airport Automotive. According to James
F. Brennan, President and Principal owner of Travel Park
Incorporated (trading as Flying Carport), Airport Automotive is a
"paper company" utilized to handle the purchase of a van by the
Chichester School District from Franklin Leasing.
4. On October 22, 1984, James Sylvester, Transportation Director of
Chichester School District, wrote a memo to Mr. Kaczenski noting that there
had been some problems transporting students from Marple Jr. High to
Chichester Sr. High. He listed the following options for Mr. Kaczenski Is
consideration= .r.
(1) transportation within the current system which would not get the last
student home until 6:30 p.m. and would mean a 4 hour bus ride for
some students;
(2) purchase of an additonal bus at a cost of approximately $25,000 and
the hiring of an additional regular driver and a bus aid. He
estimated the total cost of this option as $28,969.00;
(3) transport the students along with O'Hara students on Chichester bus
no. 19.
5. On October 24, 1984, Mr. Sylvester again wrote to Mr. Kaczenski stating
that he had contacted Mr. William Gross Jr. of Gross Equipment Company on the
renting of a school bus to transfer the Marple students. Mr. Gross stated the
cost would be $45 per day for a 1975, 76, or 77 bus with a seating capacity of
72.
6. You also serve on the Chichester School District Transportation
Commi ttee.
Mr. William McClay
Page 3
May 2, 1986
7. Transportation Committee meeting mi nutes record the followi ng:
a. October 30, 1984, Dr. Wesner reported that there were problems with
the transportation of CVS students and recommended that information
on leasing or buying a transportation van be obtained. You signed
these mi nutes as co-chairman of the committee.
b. November 7, 1984, after discussion it was agreed that a van be
leased for three months to allow time for bids to be prepared for the
purchase of a van. You signed these minutes as co- chairman of the
committee.
8. On November 13, 1984, the school district issued purchase order no. 0940
for the lease of "(1) (Ford -350 Club Wagon) $1,000.00 per month)" lease "'not'
to exceed (3) months." This van was requisitioned by D. B. Auston. The
contract had an "Extension" figure of $12,000.00. There is no explanation for
this figure.
a. Chichester School District paid Airport Automotive $1,000.00 by check
#001551 dated December 5, 1984.
b. Chicester School District paid Airport Automotive $2,000.00 by check
#000636 dated January 22, 1985.
9. Transportation Committee mi nutes record the followi ng regardi ng the
purchase of a used van by the District:
a. January 10, 1985, bids for the spare bus and CVS van were advertised
a bid opening schedule for Thursday, January 24, 1985 at 2:00 p.m.
You signed these minutes as chairperson of the committee.
b. January 24, 1985, bids were open and the committee recommended
acceptance of the hid from Airport Automotive for a 1984 fifteen
passenger van. The price was $10,500.00 and the committee stated
that "this bid fits more closely the van as specified," the committee
also recommended the purchase of a used 1982 72 passenger school Lus.
You signed this report as chairperson of the committee.
10. On November 20, 1984, the School Board on motion by Mrs. Dooley and
second by Mr. Ferro approved the solicitation of bids for a new /used van for
transportation of students.
11. The School Board solicitation for proposals for bids for this van included
the followi ng:
a. The bid was requested for one used 1984 van. Alternate bids were
allowed for a 1985 used or unused van.
Mr. William McClay
Page 4
b. The specifications were for a "1984 Model E 250 -Ford Club Wagon XL"
fifteen passenger or approved equal. This was the same make, model
and year as the van then being leased from Airport Automotive. The
specifications were prepared by James Sylvester who was the
Transportation Director.
c. Two bids were received:
(1) Airport Automotive -1984 E 250 Ford
Less 1/2 lease payment
Total
(2) Murphy Ford: 1983 E 250 Ford
50,000 miles
17,000 miles
May 2, 1986
$12,000.00
1,500.00
$10,500.00
$10,450.00
d. Bruce Austin had opened the bids and forwarded them to the
Transportation Committee for comments.
12. Minutes of the school board show that on January 30, 1985, on motion by
you and second by School Director Lee, the School Board approved the purchase
of the fifteen passenger transportation van. In addition to making the
motion, you voted to approve this purchase.
13. There are no evaluations or comments that the 1983 van did not meet
specifications except for those of the transportation committee. The request
for bids was advertised and the bid opening was public.
14. The purchase and payment for the van were recorded as follows:
a. In a letter of February 12, 1985, D. Bruce Austin, Director of
Purchasing, notified Airport Automotive that they had been awarded
the bid for the van in the amount of $10,500.00.
b. In a March 4, 1985 letter, Thomas F. Redmond, Business Administrator
for the School District, notified Mr. James Brennan of Airport
Automotive that the contract had been signed and sent him a copy for
his files.
c. At the February 19, 1985 School District meeting, own motion by Mrs.
Dooley second by you, the board approved the payment of general fund
bills in the amount of $1,047,851.20. The payment for the van was
included with these bills.
15. On February 14, 1985, a Chichester School District check in the amount of
$10,500 was issued to Airport Automotive.
a. The check was endorsed over by Airport Automotive, to Franklin
Leasing Co.
Mr. William McClay
Page 5
May 2, 1986
b. The Comptroller of Franklin Leasing Co. has confirmed that Franklin
Leasing received and deposited this check into its account.
B. Discussion: As a member of a school board, in the Chichester School
District, you are a public official as that term is defined in the State
Ethics Act. 65 P.S. §402. As such, your conduct, as a public official, must
conform to the requirements of the State Ethics Act. See Blaney, 84 -003;
Krier, 84 -002, Weaver, 85 -014.
The State Ethics Act provides as follows:
Section 3. Restricted activities.
(a) No public official or public employee shall use his
public office or any confidential information received
through his holding public office to obtain financial gain
other than compensation provided by law for himself, a
member of his immediate family, or a business with which
he is associated. 65 P.S. 403(a).
Within the above provision of law, no public official may use his public
position in order to obtain a financial gain for a business with which he is
associated. Business with which one is associated is defined in the Act as
fol lows:
Section 2. Definitions.
"Business with which he is associated." Any business in
which the person or a member of the person's immediate
family is a director, officer, owner, employee or holder
of stock. 65 P.S. 402.
From the facts of the instant situation, it is clear that as an employee
of Flying Carport, you were associated with that business as defined in the
State Ethics Act. Airport Automotive was merely a paper company created by
the owner of Flying Carport, Mr. Brennan, in order to transact the sale of the
van to the school district. Therefore, you are associated with these entities
within the definition of the State Ethics Act and you may not use your
position in order to obtain a financial gain for those entities.
The facts of the instant situation indicates that Flying Carport is in
the business of providi ng parki ng facilities and shuttle transportation for
travelers utilizing the Philadelphia International Airport. For the purpose
of transacting its business, Flyi ng Carport leases its vans from Frankli n
Leasing Co. Franklin Leasing Co. i s not part of the Flyi ng Carport /Airport
Automotive Enterprise and is a separate entity. The school district initially
leased the van for a period of several months from Airport Automotive.
Airport Automotive was a "paper company" created simply for the purpose of
leasing and selling the van to the school district. In reality, what had
occurred in this situation is that, Airport Automotive was allowing the school
Mr. William McClay
Page 6
district to lease a van through their leasing arrangement with Franklin
Leasing Co. Airport Automotive received the fee for the lease payment and
then transmitted their monthly payments to Franklin Leasing for this van.
After the school district had decided to purchase the van, this same mechanism
was utilized in order to obtain and pay for the van. The decision to
initially obtain a van either through lease or purchase was made by Mr.
Sylvester and you do not appear to have participated in that particular
decision. While you were chairman of the Transportation Committee, that
committee discussed the lease and decided that lease arrangements should be
entered into. The school district later affirmed this position and did obtain
the van. You did not draft the specifications for the van and you did not
open or receive the bids for the proposals that were forwarded. You did move
and vote on the purchase of the van. Finally, and most important, we have
ascertained from Franklin Leasing Co., that the payments made by the school
district for the leasing and purchase of this van were completely turned over
to Franklin Leasing Co. and neither Airport Automotive nor Flying Carport
obtained any benefit from the district's payment of this money for the van.
Based upon all of the foregoing information, we do not believe that you
violated the State Ethics Act, in that, the business with which you are
associated, i.e. Flying Carport and Airport Automotive, did not receive any
financial gain as a result of the district's purchase of the van through those
companies. The funds that were paid by the district went to Franklin Leasing
Co. As such, we find no violation of the Act.
While we have found no violation of the State Ethics Act in the instant
situation, we do note that all of the circumstances and factors in the instant
situation may lead to public perceptions that you were, in fact, using your
public position to obtain a financial gain for a business with which you are
associated. Generally, the public would not have access to the information
available to you and to the State Ethics Commission indicating that there was
no financial gai n obt ained by the companies with which you were associ ated.
On the face of this matter, it initially appeared as though you had, through
your position on both the Transportation Committee of the board, on the board
itself, arranged to have the district pay a substantial amount of money to a
company with which you are associated in order to obtain a van. You were a
prime moving factor in the purchase of the van and you were involved in
various discussions regarding the situation. Section 1 of the State Ethics
Act provides as follows:
Section 1. Purpose.
The Legislature hereby declares that public office is a
public trust and that any effort to realize personal
financial gain through public office other than
compensation provided by law is a violation of that trust.
In order to strengthen the faith and confidence of the
people of the State in their government, the Legislature
further declares that the people have a right to be
assured that the financial i nterests of holders of or
May 7, 1986
Mr. William McClay May 2, 1986
Page 7
candidates for public office present neither a conflict
nor the appearance of a conflict with the public trust.
Because public confidence in government can best be
sustained by assuring the people of the impartiality and
honesty of public offici als, this act shall be liberally
construed to promote complete disclosure. 65 P.S. 401.
Within the above provision of law, it is clear that a public official 's
activities should not lend themselves to lead the public to believe that their
personal financial interests conflict or appear to conflict with the public
trust. In the instant 'situation, it could clearly appear as though your
personal financial interest, through your association with the aforementioned
companies, conflicted with the interests of the school district and with your
duties to serve the school district. While the facts of the current
situation revealed that the companies did not obtain any financial gain, we do
believe that you should be more sensitive to the way in which the public that
you are elected to serve, would view your activities. You should have placed
on the record documentation indicating that the companies with which you were
associ ated were not goi ng to receive any financial gai n from this transaction.
You should be mindful of such situations in the future and conduct your
activities in accordance with Section 1 of the Act.
C. Conclusion: Based upon al 1 of the foregoing factors, we do not beli eve
that your conduct violated the State Ethics Act. This is so specifically in
light of the fact that neither you nor the companies with which you were
associated received financial gain from the transportation. We do hel i eve,
however, that you should be more sensitive to public perceptions and conduct
your activities in accordance with Section 1 of the Ethics Act.
Our files in this case will remain confidential in accordance with
Section 8(a) of the Ethics Act, 65 P.S. 408(a). However, this Order is final
and will be made available as a public document 15 days after service (defined
as mailing) unless you file documentation with the Commission which justifies
reconsideration and /or challenges pertinent factual findings. See 51 Pa. Code
2.38. During this 15 -day period, no one, including the Respondent unless he
waives his right to challenge this Order, may violate this confidentiality by
releasing, discussing or circulating this Order.
Any person who violates the confidentiality of a Commission proceeding
is guilty of a misdemeanor and shall be fined not more than $1,000 or
imprisoned for not more than one year or both, see 65 P.S. 409(e).
By the Commission,
If XS 624 ~- 01 v4Z
G. Sieber Pancoast
Chairman